Charities Property Fund returns 11.2 per cent in 2013

The Charities Property Fund, managed by Cordea Savills, achieved a total return of 11.2 per cent in 2013.

This compares to the AREF All Balanced Funds Index of 9.1 per cent.

The fund also outperformed the other two charity specific funds which produced 9.1 per cent and 7.4 per cent respectively.

In one of its most successful years since inception 13 years ago, the fund invested GBP130m in 15 new assets, reflecting an average yield of 6.5 per cent after the costs of acquisition. It also made four sales, raising GBP14.6m. Over the same period the fund’s dividend increased four per cent and is forecast to grow by a further five per cent in 2014.

As the original charity-specific property fund with a broad investor base of 1,437 charities, its key investment objective is to deliver a high and secure level of income. In 2013, the fund delivered an annual income of 5.8 per cent, which compares favourably with the 4.4 per cent p.a. average dividend payable by the funds in the IPD All Balanced Funds Index and 2.8 per cent available on 10-year Gilts. The fund is the largest charity-specific property fund having grown by 27 per cent in 2013.

Over 2013, significant value has been added to the fund through active asset management: for example, 50 new lettings and lease renewals have created or protected GBP2.35m p.a. of income and lowered the void rate from 5.4 per cent to just two per cent, compared to an IPD average of 10.5 per cent.

Harry de Ferry Foster (pictured), fund director, says: “The fund performed tremendously well over 2013 and continues its record of outperforming the AREF All Balanced Funds Index over one, three, five and 10 years and since launch. In the last 12 months we have strengthened our core portfolio, which is well positioned to generate strong returns over the next few years. We look forward to seeing the fund continue to attract new investors and continue to grow its asset base.”